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Microsoft To Join With Yahoo?

The Wall Street Journal is running an article that says Microsoft is trying to work out some sort of deal with Yahoo. It suggests the idea of Microsoft buying a stake in Yahoo, but only in that way reporters do when they want to start a rumor that they know isn’t true. See what I mean:

Currently, talks of an equity stake in Yahoo don’t appear to be active, given that Microsoft is focusing on a reorganization that it hopes will re-energize its effort to compete with Google, the fast-growing provider of search services and advertising.

Still, but talking about it, they’ve gotten a lot of links. Good work, boys.

What might be going on is a partnership between the two. Microsoft wouldn’t abandon all the money it has poured into Windows Live, especially not after the Street objected and Microsoft responded by saying they’d spend even more.

However, there are a lot of areas the two companies don’t overlap, and some sort of agreement to promote the other’s services could be a good strategy to beat Google. If you integrate the two in interesting ways, you could entice users by showing that combined, Live and Yahoo have everything you could need, more so than Google.

One idea: Integration of Microsoft Gadgets into Konfabulator. Considering the Gadgets can run on Windows’ desktop via Windows Sidebar, letting them run in Konfabulator as well increases the reach. Microsoft could also integrate portions of Yahoo Music, like Launchcast, into Windows Media Player. The possibilities are endless, although not as likely as the speculation seems to suggest. Still, a Microsoft/Yahoo partnership has more promise than the Google/AOL one did.

May 3rd, 2006 Posted by Nathan Weinberg | Yahoo, Live, Google, Windows, MSN, General | no comments

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